NASHVILLE, Tenn. (WTVF) — If you're shopping for a new car, you’ve probably seen that prices are still high and interest rates haven’t really eased up and with more families falling behind on payments or even losing their cars, staying on budget matters now more than ever.
New car prices are averaging around $50,000 and interest rates are near 7 percent.
Gustavo Flores-Macias, Dean of the School of Public Policy at the University of Maryland says tariffs are not helping.
“It has affected the price of these vehicles and it affects consumers' ability to afford them,” said Flores-Macias.
That’s why Consumer Reports says it’s especially important for shoppers to know what to expect when buying a new vehicle.
Consumer Reports closely monitors the auto market, buying 40 to 50 new cars every year for testing.
“You want to watch out for things like add ons and extras and fees that can push up a price by hundreds or thousands of dollars,” said Keith Barry.
To compare prices and see what’s actually available near you, check the manufacturer’s site, plus places like TrueCar, Cars.com, or CR’s Build and Buy service. If local dealers don’t have what you want, look outside your immediate area – but not too far.
Also, it’s worth looking into financing through your bank or credit union.
“Sometimes dealerships offer promotional financing, which can save you a lot of money, but at the very least, talking to the bank gives you a baseline that you can compare against what the dealer offers.”
Consumer Reports cautions against those really long 84 or 96-month loans. The monthly payment may seem manageable, but interest can drive the overall cost much higher. And for buyers thinking about leasing there are trade-offs to consider.
“Make sure what the mileage limits are, the fees that you could face at the end of that lease and any maintenance or repair that you have to pay when you turn in the car at the end of the lease.”
And whether you’ll be leasing or buying. Don’t feel rushed into signing a contract. Giving yourself time to understand what you’re agreeing to can save you a lot of stress down the road.
Extended warranties can give you some peace of mind once the manufacturer’s coverage runs out, but they can also add thousands to the price. Experts say you’re often better off choosing a reliable car and setting aside money in an emergency fund instead.
Do you have more information about this story? You can email me at jennifer.kraus@newschannel5.com.
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